Melco Int plans listing in Philippines M
elco International Development Ltd is seeking a US$300 million listing on the Philippine Stock Exchange, sources in Hong Kong have told Business Daily. The proceeds will go toward fitting out and operating a Manila casino resort built as a shell by a third party. A Hong Kong source said: “There would be US$300 million equity from a local listing, and a US$220 million loan provided to Melco by a local bank, Banco De Oro.” Gaming investment company Melco International – which is already on the Hong Kong bourse – is also a 33.6 percent
shareholder in Macau casino operator Melco Crown Entertainment Ltd (MPEL). The memorandum of understanding for the Philippines project –Belle Grande Manila Bay – was originally signed in July between a unit of MPEL and the Philippine property and leisure firm Belle Corp. controlled by the family of Henry Sy, according to a filing made to the HKSE. Banco de Oro – officially known as BDO Unibank Inc. – is 26.23 percent owned by SM Investments Corp., a Philippines conglomerate controlled by the Sy family. More on page 3
I SSN 2226-8294
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HANG SENG INDEX 19570
19520
19470
19420
September 4
ING selling loss-hit local insurer
Govt to seize Ao’s Waterleau shares
ING Groep NV of the Netherlands is hoping to sell ING Life Insurance Co. (Macau) Ltd and its Hong Kong insurance business in a single deal. The European Union has demanded the sale as a condition of the financial services company receiving 3 billion euros (30.21 billion patacas) in public bailout money. ING confirmed that its Macau unit, with about 20 employees, is considered part of its Hong Kong insurance business.
A utility company shareholding of former public servant Ao Man Long is finally to be seized by the government – three months after a local court ordered the action to be taken. In May the former secretary of Transport and Public Works was ordered to forfeit 31.9 million patacas (US$3.99 million) and his 20 percent stake in wastewater plant operator Waterleau Macau Lda.
Page 2
Page 7
HSI - Movers Name
%Day
N/A
N/A
SANDS CHINA LTD
1.43
CHINA UNICOM HON
0.82
CHINA LIFE INS-H
0.72
COSCO PAC LTD
0.42
CHINA COAL ENE-H
-1.99
SINO LAND CO
-2.31
CHINA PETROLEU-H
-2.74
LI & FUNG LTD
-2.93
CITIC PACIFIC
-4.17
Source: Bloomberg
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Baccarat VIPs like poker’s maths
Cumin soon – SpiceJet Airlines Page 4
www.macaubusinessdaily.com
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PRC’s Macau office to get new boss Page 6
2012-9-05
2012-9-06
2012-9-07
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Year I - Number 113 Wednesday September 5, 2012 Editor-in-chief: Tiago Azevedo Deputy editor-in-chief: José I. Duarte MOP 6.00
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business daily September 5, 2012
macau New fly ash site found The current landfill site for construction waste near the Macau airport will be the new location to bury the ashes from the incineration plant, the Environmental Protection Bureau revealed. In a reply to an inquiry from legislator Ng Kuok Cheong, bureau director Cheong Sio Kei wrote that a third-party study commissioned in 2009 was completed and proposed the construction of a waste landfill. A temporary storage will be set up inside the construction waste site before the completion of the new area for fly ashes.
ING to sell Macau, HK insurance units together Manulife, AIA and Richard Li are in the hunt for ING’s Asian insurance business, including a subsidiary in Macau Xi Chen
xi.chen@macaubusinessdaily.com
I
NG Groep NV of the Netherlands is hoping to sell ING Life Insurance Co. (Macau) Ltd and its Hong Kong insurance business as a job lot, after being told by European authorities to get rid of its insurance operations. Bloomberg quoted two unidentified sources as saying ING was in talks with buyers that wanted pieces of its Asian life insurance business in various markets. European Union officials ordered the company to sell its insurance operations worldwide before the end of next year as a condition for allowing it to receive state aid in 2008 and 2009. ING must also repay the 3 billion euros (30.21 billion patacas) of state aid and a 50 percent premium it owes the Dutch government by the end of next year. Bloomberg reported that the company was seeking a single buyer for its insurance businesses in Southeast Asia, Hong Kong and Japan. But Reuters reported that ING may sell its Hong Kong insurance business separately to maximise its return on the sale. The Hong Kong insurance business was worth about US$1 billion. ING spokeswoman Victorina de Boer said ING’s Macau insurance unit was considered part of its Hong Kong insurance business. In an email response to questions from
Business Daily, she did not value the Macau business. ING said last month that its Asian insurance and asset management businesses had a combined book value of 6.6 billion euros. ING’s Macau insurance unit made a loss of 37.2 million patacas (US$4.7 million) last year, adding to more than 100 million patacas in losses accumulated in previous years.
The unit had about 20 employees at the end of last year. Bloomberg quoted unidentified insiders as saying ING was pressing prospective buyers of its Hong Kong and Southeast Asian insurance business to acquire a part of its Japanese insurance subsidiary, too. Bidders that include Manulife Financial Corp. have expressed a willingness to buy ING’s Japanese
insurance subsidiary as part of a deal to buy ING’s insurance business in Hong Kong and Southeast Asia. ING is also reported to be considering offers from AIA Group Ltd and Hong Kong billionaire Richard Li Tzar Kai which would include the purchase of the Japanese subsidiary. Mr Li is reportedly the leading contender for the Hong Kong unit. With agencies
ING Life Insurance Co. (Macau) Ltd will be sold as part of ING’s Hong Kong insurance business
No visa-free pass for Hengqin visits Officials have rejected a proposal for visa-free travel between Macau and Hengqin
M
Hengqin may be a special administrative area but there will be no unique exceptions for mainland travellers from current visa system
ainland visitors holding a single-entry visa for Macau will not be able to travel between the city and Hengqin Island on the same permit, the Hong Kong and Macau Affairs Office of the State Council announced. Despite Hengqin being granted numerous special privileges by Beijing, there will be no exceptions when it comes to rules on visas. Under the current system, if a mainland tourist arrives in Macau and subsequently visits Hengqin, they will not be allowed back into Macau without a new entry visa. Nor is there a multiple-entry visa system for mainland visitors travelling to Macau. Instead, most mainlanders are allowed to visit the territory just once every two months and they must apply for a
new visa each time. Member of the Legislative Assembly Chan Meng Kam, who is also a delegate to the Chinese People’s Political Consultative Conference, proposed earlier this year that mainland tourists should be allowed to travel back and forth to Hengqin freely while visiting Macau. The proposal would also increase cooperation between Macau and Guangdong, accelerating the city’s transition into an international tourism and leisure centre, public broadcaster TDM reported. While it rejected the proposal for visa-free travel, the Hong Hong and Macau Affairs Office of the State Council said it would instruct the relevant departments to further research the issue. X.C.
September 5, 2012 business daily | 3
MACAU
Melco International seeks new US$300 mln listing Gaming investor wants cash for Philippines project Associate Editor
way of introduction, meaning that no new funds were raised. A filing to the HKSE in July said MPEL – which developed and runs City of Dreams on Cotai and Altira on Taipa – would invest up to US$580 million in Belle Grande Manila Bay via a company called MPEL Projects Ltd, including about US$320 million from a loan facility. Belle Grande has been described in Philippines media reports as a US$1 billion scheme.
Structure completed
Grande designs – Melco Int to spend US$520 million on Belle Grande Manila Bay
M
elco International Development Ltd is seeking a US$300 million (2.4 billion patacas) listing on the Philippine Stock Exchange in Manila, two sources in Hong Kong have told Business Daily. It would use the proceeds toward the cost of furbishing and operating a Manila casino resort built as a shell by a third party. Gaming investment company Melco International – which is already on the Hong Kong bourse – is also a 33.6 percent shareholder in Macau casino operator Melco Crown Entertainment Ltd (MPEL). The memorandum of understanding for the Philippines project –Belle Grande Manila Bay – was originally signed in July between a unit of MPEL and the Philippine property and leisure firm Belle Corp. controlled by the family of Henry Sy, according to a filing made to the HKSE. Now Business Daily
understands only Melco International will be involved in financing the deal. The reason for the change in investment structure is not clear. One possible reason is regulatory issues. MPEL is a joint venture between Melco International and Australian casino company Crown Ltd, the latter listed on the Australian Securities Exchange. MPEL in its turn is listed on the Nasdaq in New York and on the Hong Kong Stock Exchange. The NYSE and the ASX in particular are known to take a robust approach to gaming regulatory issues. The Philippines has been criticised by some analysts for alleged laxity in gaming regulation and for operating a system whereby the Philippine Amusement and Gaming Corporation acts as both gaming regulator and casino operator, competing against private venues. Other sources told Business Daily it would be easier for Melco International to raise fresh equity for
the Manila Bay project than for the already dual-listed MPEL.
Equity plan MPEL listed first on Nasdaq in December 2006 at US$19.00 per share according to information on the Nasdaq website. At the end of trading on Friday – prior to Monday’s Labor Day holiday in the United States – the stock was at US$11.72 according to data from Reuters. One finance industry source in Hong Kong said: “Given that MPEL launched on Nasdaq at US$19 and is now trading at a 40 percent discount, there’s some lingering scepticism in the markets regarding MPEL stock – despite the company’s strong future story in Macau.” MPEL had planned to raise up to US$600 billion in its 2011 listing in Hong Kong according to local analysts quoted at the time. In the end, it listed in November 2011 by
“The Sy family decided just to complete the shell of the resort and then invite other people to lease the building, pay to fit it out and operate it,” a source said. The MOU had a 60-day cooling off period, due to expire soon, but Business Daily understands Melco and Belle Resorts are anxious to complete the deal but in a modified form and a slightly reduced cost. A Hong Kong source said: “There would be US$300 million equity from a local IPO, and a US$220 million loan provided to Melco by Banco De Oro, a Philippine bank. The shell of the building has already been built by the Sy family, so the US$520 million will go toward fitting it out. There won’t be any cash in the deal.” Banco de Oro – officially known as BDO Unibank Inc. – is 26.23 percent owned by SM Investments Corp., according to a filing to the Philippine Stock Exchange made by the bank in March. SM Investments is a Philippines conglomerate controlled by the Sy family. Business Daily approached Melco International and MPEL for a comment on the suggested Manila listing for Melco, but no statement was available at the time of going to press.
Phone sales boost SmarTone profit With handset sales soaring, mobile services provider SmarTone Macau saw earnings rise Vítor Quintã
vitorquinta@macaubusinessdaily.com
S
marTone Mobile Communications (Macau) Ltd has seen its operating profit for the year ended June 2012 grow by almost two-thirds, the firm’s parent company announced yesterday. The venture reported an operating profit of HK$72 million (US$9.3 million), up by 64.7 percent from the previous year, SmarTone Telecommunications Holdings Ltd told the Hong Kong Stock Exchange. The profit boom in the territory was driven by higher service revenue and increased handset sales, the company said. By the end of July there were 1.48 million mobile service subscribers in Macau, according to official data from the Bureau
Telecommunications Regulation. Inaddition,salesofcommunications equipment during the first half of 2012 rose by 12 percent year-on-year to 499 million patacas. As a result, SmarTone Macau’s revenues rose by 36.2 percent to HK$385 million. However, the MSAR operations account for less than four percent of SmarTone’s overall revenues, which mostly come from neighbouring Hong Kong. The Hong Kong-based group posted a net profit above HK$1 billion, up by 36 percent year-onyear, and proposed a dividend of HK$0.99 per share. Despite the growth, SmartTone Macau has still been unable fully to
Despite the growth, SmartTone Macau unable to challenge former monopoly holder CTM (Photo: Manuel Cardoso)
challenge former monopoly holder Companhia de Telecomunicações de Macau, SARL, better known as CTM. Last year, CTM raked in revenue
of 3.98 billion patacas, up by 44.4 percent from 2010 and posted a profit of 934 million patacas, a year-onyear increase of 14.7 percent.
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business daily September 5, 2012
macau Okada asks judge to restore Wynn shares
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Kazuo Okada has requested a Las Vegas judge to restore his shareholding in Wynn Resorts Ltd. Mr Okada – in a filing with Clark County District Court Judge Elizabeth Gonzalez – also asked leave to nominate new directors for consideration at Wynn’s annual meeting on November 2. The Japanese gaming machine maker once held a 20 percent stake in the Las Vegas-based casino company – which now earns much of its money from its Macau operations. But in February the stake was forcibly redeemed by Wynn at a 30 percent (US$800 million) discount over allegations he was “unsuitable”.
HOSPITALITY MICE gets it right Meetings, incentives, conferences and exhibitions, or MICE events, have declined significantly in both number and duration since 2010. The MICE business was expected to contribute significantly to the city’s economic diversification. And, although this emerging industry would rely partly on the casinos and their leisure facilities, it could reduce the city’s economic dependence on gambling and increase its appeal to a broader audience. It has not played out as planned, which may tend to suggest that the industry has failed to live up to expectations. But there is one indicator that has moved against the tide: participant numbers.
Baccarat VIPs get Texas hold ‘em fever But game’s future uncertain after regulator changes poker table count rules Associate Editor
If participation was the sole measure of the industry’s success, the first line graph would represent an unqualified success. There are extremes in the data which seem excessive and may be an accounting quirk but, overall, the numbers are impressive. The total number of participants rose by 40.7 percent in 2010 and 58.8 percent last year. The main contributors to this growth were participants in exhibitions, which rose, respectively, by 44.4 percent and 77.9 percent. The number of people attending meetings has dropped off but they represent only a small part of the bigger picture.
The quarterly figures display a neat seasonal pattern; the last two quarters of the year, and the third quarter in particular, are the strongest by far. The number of participants in each quarter varies significantly. In the fourteen quarters displayed here from 2009, the average participation varies from 989 people in the first quarter of 2009, to 33,162 people in the third quarter of 2010. The results for the first half of this year seem to be following a similar pattern. Data from the second half of the year will show if last year’s outstanding second-half participation numbers were a once-off or part of a deeper change. J.I.D.
Poker gets a big hand from VIP
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acau’s VIP baccarat players are increasingly turning to high stakes Texas hold ‘em poker as a way to win big money at relatively low risk says a gaming industry insider. “VIP baccarat players are realising that for a poker buyin of HK$2 million they can maybe win HK$10 million or even HK$20 million by playing against each other. It’s really hard to win that sort of money against the house at baccarat. You might have to roll HK$20 million in baccarat bets to win HK$50 million,” said the person. The point about rolling in VIP baccarat is that the player’s risk exposure starts high. In Macau the big stakes baccarat players are issued credit by the junket operators, so are required by those junkets to commence each session with a pile of non-negotiable chips. Only when the player wins can ‘NN’ chips used in that bet be converted to cash ones. That means the player has to keep rolling even when losing, in order to try and get to a winning position producing cashable chips. Although the operators of high stakes poker games in Macau casinos are not authorised by the gaming regulator to issue player credit, each player’s risk exposure is clear from the outset. An initial buy-in fee goes toward creating a prize pool shared among the players, with the house making its money
via a ‘rake’ – a percentage cut of the aggregated buy-in. Further player buy-ins – known as ‘re-buys’ are also possible if a player runs out of chips – at the discretion of the poker room operator.
Entertainment value Winfred Yu, business director, poker, for Macau Laxino, a company that runs the Poker King poker room at Galaxy Entertainment Group Ltd’s StarWorld Hotel & Casino, says the currently popularity of high stakes poker started among junket agents whiling away time while their VIP clients played baccarat upstairs. “What happened was the VIP players noticed their agents were playing poker and started trying it for themselves.” An indication of how poker has spread to the VIP baccarat crowd is that Hong Kong-listed Neptune Group Ltd, one of the biggest investors in junket rooms in the Macau market, acted as guarantor for the recent Macau High Stakes Challenge, a one-day poker tournament held at the Poker King room that drew professional players from around the world. Another indicator of poker’s rise is that the winner of the event – Stanley Choi – isn’t a poker pro but actually a VIP baccarat player according to industry sources. “Junkets are now offering high
stakes poker – via authorised poker rooms – as a value added service to their high stakes baccarat players,” said the insider. Mr Choi won a record HK$50 million (US$6.4 million) in the Macau High Stakes Challenge. The HK$200 million prize pool – including the winner’s share – was the biggest ever for a one-day poker tournament. The top prize on offer was the third highest in the history of tournament poker outside of the four-day World Series of Poker events held annually in Las Vegas, said the industry source. An irony is that the Macau High Stakes Challenge tournament was held only days after the city’s casino regulator, the Gaming Coordination and Inspection Bureau, announced it was dropping a discretionary scheme whereby local casinos would be allowed to count up to 20 poker tables as equivalent to one baccarat table for the purposes of the Macau government’s table cap. The cap is set at 5,500 tables until 2013, and then 3 percent compound annual growth for a further decade. “Most people are assuming the policy retreat on poker was because the policy offered a way round the table cap. I would suggest it’s because there are important people in China with investments in the Macau junket system. They don’t want to see other games they don’t control getting too popular,” added a second source.
September 5, 2012 business daily | 5
MACAU
Direct Delhi flights now one step closer Budget airline SpiceJet waiting on government approvals; could take off as soon as November Tony Lai
tony.lai@macaubusinessdaily.com
I
ndian low-cost carrier SpiceJet Airlines Ltd could open the first direct flight between Macau and India as soon as November, says Macau International Airport Co Ltd. Macau officials met SpiceJet chief executive Neil Mills in India last week and told the tourists the airline had applied to commence direct flights from New Delhi. Flights “could start as soon as in November” with three flights a week at first, an airport press statement said. “Both parties have strong intentions of making this work,” said airport marketing manager Patricia Au. She told Business Daily the company had been in discussions with SpiceJet for “quite some time” because it sees “tourism potential” in direct flights. The future of the venture depends on winning approvals from India’s Directorate General of Civil Aviation and the Macau Civil Aviation Authority. SpiceJet began operations in 2005 and mainly operates domestic flights, with some limited international services to the United Arab Emirates, Nepal and Afghanistan. The budget airline is controlled by Indian billionaire Kalanithi Maran, who owns Sun Group, one of the country’s biggest media conglomerates. SpiceJet was not available for comment last night. The Macau Civil Aviation Authority said it had not received “a formal request from any local airline
SpiceJet Airlines says it has applied for the right to start direct flights from New Delhi
or Indian airline” applying to open flights between Macau and India. The regulator told Business Daily it was likely to “discuss with the Indian aviation authority about updates of the flight service agreement between the two sides” at the 49th Conference of Directors-General of Civil Aviation, Asia-Pacific Region, in New Delhi next month. Macau’s tourism officials have
Hotels pricier, but still busy Even though the city has more hotels, they are more expensive – but guests keep coming Tony Lai
tony.lai@macaubusinessdaily.com
T
he cost of staying in a threestar hotel had increased by almost 12 percent in July compared to a year before but occupancy rates are still high. Data released yesterday by the Macau Hotel Association show the average room rate was 1,340 patacas (US$167.50) in July, 1.5 percent more than a year before. During the Lunar New Year holidays in January the room rate exceeded 1,600 patacas a night. The average room rate in threestar hotels in July was 980 patacas, 11.9 percent more than a year before, and higher than the average of 796 patacas a night for a four-star hotel room. The average room rate in five-star hotels, which contain 61.1 percent the city’s 24,268 guestrooms, was 1,584 patacas a night. The occupancy rate across all
accommodation grades was 90 percent in July, the same as in June but down 2.3 percentage points on the same time last year. In the first seven months of this year, the average room rate in all hotels was 1,407 patacas, 8 percent more than a year earlier, and occupancy was 87 percent, the same as a year before. The average room rate in threestar hotels rose by more than 12 percent to 964 patacas and the average in four-star hotels also rose by over 12 percent, to 840 patacas. The average cost of a night in a five-star hotel rose by 6.75 percent to 1,670 patacas. The Macau Hotel Association gathered these statistics from its 40 members – 21 five-star, 10 four-star and nine three-star hotels. The city had 99 registered hotels and guesthouses at the end of July.
been chipping away at India’s tourist market, most recently touring three cities – Chennai, Mumbai and New Delhi – last week in a joint promotion with Hong Kong and Guangdong.
The number of Indian visitors to Macau has increased from less than 10,000 in 2003 to 170,000 last year. Arrivals are down by 8.5 percent during the first seven months of this year.
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business daily September 5, 2012
macau
Li Yuanchao tipped as next Macau supremo
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GDP drivers In the second quarter of this year the annual rate of economic growth slowed noticeably. It was among the slowest rates of growth in gross domestic product since 2004, not counting the financial crisis in the second half of 2008 and first half of 2009. That a 7 percent rate of growth is considered too slow tells us something about the extraordinary times we live in. Our fastest growth rate was 32.5 percent, in the second quarter of 2010. Two things drove this spurt of growth. One was private investment, which increased the supply of casinos and related facilities. The other was rise in the export of services, due to the opening of the border that allowed in the visitors that demanded these new facilities.
The investment boom has peaked and waned, as the graph above shows. Gross fixed capital formation, or physical investment, as a percentage of GDP rose in real terms from around 12 percent in 2001 to a peak of 35 percent in 2007. Last year it fell back to about what it was at the beginning of 2001.
The Communist Party’s organisation chief will reportedly be in charge of Hong Kong and Macau Affairs in the new Politburo Xi Chen
xi@macaubusinessdaily.com
Li Yuanchao, right, could be the new chief of Hong Kong and Macau Affairs
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he head of the Communist Party’s organisation department, Li Yuanchao, will probably join the Politburo as vice-president and be put in charge of Hong Kong and Macau Affairs, South China Morning Post has reported. The Communist Party established the Central Leading Small Group on Hong Kong and Macau Affairs in 2003 as the most senior decision-making committee in the government with a say in the direction of both SARs. Since then it has been headed by the vice-president: first Zeng Qinhong,
until 2008, and now Xi Jinping. The Hong Kong-based Chineselanguage newspaper Ming Pao r ep o r ted th a t 6 1 - y e a r - o l d M r Li would be third in rank in the Politburo, after Mr Xi, who would become president, and Li Keqiang, who would become premier. The newspaper said Mr Li had close links with the incumbent president, Hu Jintao. Mr Li also has a background that appeals to other factions in the party such as the Shanghai faction and the “princelings”, the children
and grandchildren of prominent party members. Mr Li and Mr Hu were both members of the secretariat of the Communist Youth League of China in the 1980s. In 2003, Mr Li became party chief in the economically important province of Jiangsu. Four years later, he took over the organisation department, which has the authority to appoint officials to positions anywhere in the country that carry the rank of provincial vice-governor or above.
New reporting system for aviation incidents As for the other driver of growth, exports of services as a percentage of GDP rose in real terms from an already high level of almost 60 percent in 2001 to slightly less than 110 percent last year. Exports of services and physical investment combined, as a percentage of GDP, had climbed to more than 120 percent of GDP by the end of last year, despite the contraction in physical investment. This reflects the already extreme and increasing dependence of the economy on gambling and associated activities. And the figures for the first two quarters suggest that this level will be sustained this year. J.I.D.
T
he Macau aviation regulator is working on a voluntary incident reporting system, which will be launched after a new law on aviation safety pending at the Legislative Assembly comes into effect. The ‘Macau Confidential Aviation Reporting System’ aims to encouraging industry staff to speak about “any possible factors that may
contribute to an incident in their daily operation,” the Civil Aviation Authority said yesterday. The ultimate goal of collecting safety information is to allow for “corrective measures” to be taken to prevent incidents from occurring, the regulator said in a statement. But the system will only be implemented together with the
Aircraft Accident and Incident Investigation and Aviation Safety Information Protection Law. The draft bill, whose discussion is on hold during the assembly’s summer break, should come into effect still this year, the authority said after hosting a regional workshop on aviation accident investigation. V.Q.
Weather Beijing 25/17o C Changchun 22/11o C
Harbin 20/10o C
Xian 29/16o C Shanghai 27/23o C Chengdu 31/21o C Kunming 25/16o C Haikou 31/23o C Sanya 30/25o C
Guangzhou 34/24o C
MACAU (3-8 September) Day
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70/95 %
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Shenzhen 33/25o C
ASIA (today)
Hong Kong 30/26o C
Manila
Macau 29/24o C
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30/24 C
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26/20o C
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taipei
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September 5, 2012 business daily | 7
MACAU
Govt acts to seize Ao stake in Waterleau
Corporate
The Financial Services Bureau is at last taking action to ensure Ao Man Long forfeits his shares in Waterleau Vítor Quintã
New event director for G2E Asia
vitorquinta@macaubusinessdaily.com
T
he government has begun legal proceedings to take over the 20 percent stake in Taipa wastewater plant operator Waterleau Macau Lda that belonged to disgraced former government secretary Ao Man Long. The Court of Final Appeal sentenced Mr Ao to 29 years in prison on May 31 for corruption and money laundering while he was secretary of transport and public works, and ordered him to forfeit 31.9 million patacas (US$3.99 million) and his stake in Waterleau. It was not until four months later that a spokesperson for the Financial Services Bureau told Business Daily that the bureau had received a copy of the court’s judgement. A copy had reached the office of Mr Ao’s successor as secretary of transport and public works, Lau Si Io, less than two weeks after the judgement was delivered. Now a spokesperson for the Financial Services Bureau has said
Ao Man Long.
it is “carrying out the necessary procedures in accordance with the court’s ruling and relevant legal requirements regarding the forfeiting of the company’s shares”. Administrative law expert Vítor Gomes told Business Daily last month that the government, or more probably the Public
Prosecutions Office, would have to go back to court to get the Court of Final Appeal’s order enforced. “The judge will then decide to change the name on the share certificates from the defendant to the MSAR. That decision will clinch the transfer of the shares,” he said. The Court of Final Appeal said the shares were a bribe given to Mr Ao to ensure that Waterleau Macau’s Belgian parent company, Waterleau Global Water Technology NV, won contracts for wastewater treatment plants in the cross-border industrial park and on Coloane. If and when the government gets its hands on Mr Ao’s stake in Waterleau Macau, it will become a shareholder in a subsidiary of Waterleau Group, which is suing the government over the botched tender for the wastewater treatment plant on the peninsula. The Financial Services Bureau had no comment on whether the government will keep its stake or try to sell it.
Royalties music to writers’ ears Government action to protect copyrights is given credit for filling the bank accounts of creative types Vítor Quintã
vitorquinta@macaubusinessdaily.com
T
he amount of royalties paid for the use of copyrighted material grew faster here last year than anywhere else in Asia – setting a record – mostly because of music licensing deals. The Chinese-language Jornal do Cidadão quoted the 2011 report from the Macau Association of Composers, Authors & Publishers as saying royalties amounted to more than 1.08 million patacas (US$135,200), the most ever. The total was 60 percent more than in 2010, meaning growth in royalties here was the fastest in Asia. A big slice of the royalties was paid by the more than 300 commercial establishments granted licences to play copyrighted music. Most licences went to retailers selling big name branded goods. The newspaper quoted the president of the association, Ung Kuoc Iang, as saying royalties paid for live performances of music accounted for 12 percent of last year’s total. The association has signed licensing agreements with The Venetian Macao, allowing it to play copyrighted music in its 15,000seat Cotai Arena, with flag carrier Air Macau Co. Ltd and with Apple Inc’s iTunes online music store. Apple opened iTunes in 12 Asian
Reed Exhibitions has promoted Mike Johnson to event director and general manager of Global Gaming Expo Asia – also known as G2E Asia. The region’s leading trade show and conference event for casino equipment suppliers has been held in Macau every year since Reed bought the rights to a previous event – the Asian Gaming Expo – from the Australasian Gaming Machine Manufacturers’ Association in 2006. Mr Johnson has worked on the G2E portfolio of events for six years. He will continue to serve as director of sales and industry development for G2E Asia and its sister event G2E in Las Vegas. “…we look forward to Mike expanding on his current roles to help ensure that G2E and G2E Asia continue to be the largest and most successful trade show and conference events for gaming professionals,” said Courtney Muller, a Reed senior vice president in response to the appointment.
Permira exec resigns from Galaxy board Henry Lin Chen – an executive of the United Kingdom-based private equity company Permira Advisers LLP – has resigned as a non-executive director of Macau casino operator Galaxy Entertainment Group Ltd. The move took effect from Monday. “The board would like to express its gratitude to Mr Chen for his support and invaluable contribution to GEG during his term of appointment and offers its best wishes to him,” Galaxy said in a statement filed with the Hong Kong Stock Exchange. Last week it emerged Permira had sold more than half its remaining 12.6 percent stake in the casino operator for HK$5.85 billion (US$754 million). Twothirds of the sold shares went to Waddell & Reed Financial Inc., a Kansas-based asset management company. Permira originally invested just HK$6.53 billion in 2007 for a 20 percent stake in Galaxy. The stock lost more than 94 percent of its value within a year of the deal but recovered strongly in 2011, rising to 170 percent of its 2007 price by this year.
Gaming & Hospitality Congress at Galaxy Macau Live performances of music accounted for 12 percent of the royalties paid here last year
markets in June, allowing customers here to buy and download millions of music tracks and films. Analysts said this was a sign that intellectual property rights were now better protected in the markets newly granted access to Apple’s online store. Mr Ung said last year’s figures were due to copyright protection work done by the Economic Services Bureau and the Macau Customs Service. Amendments to the copyright law came into effect in June, extending protection to the Internet
and other digital technologies. The amendments provide for a maximum prison sentence of two years for sharing protected files over the Internet “with the intent of receiving an illegal benefit”. The government has said it will quickly ratify two international treaties on copyright: the Copyright Treaty and the Performances and Phonograms Treaty, both signed in 1996 under the auspices of the World Intellectual Property Organization. The mainland and Hong Kong have already ratified the treaties.
Duarte Chagas, legal adviser to Macau’s Gaming Inspection and Coordination Bureau, is among speakers at the fifth Asian Gaming & Hospitality Congress to be held this year at Galaxy Macau from November 27 to 29. Other speakers include Hoffman Ma Ho Man, deputy chief executive of the Ponte 16 Gaming resort in Macau, and Ping Lam, director of marketing (mall marketing and corporate partnerships) for Sands China Ltd. The congress, organised by Beacon Events, covers legal, regulatory, marketing and technology issues for operators of casinos and integrated resorts. Beacon says the event will also give a broader view of the economic forecast for key Asian markets and explain how regional developments will affect operators’ competitiveness and ability to raise finance for new projects.
8 |
business daily September 5, 2012
GREATER CHINA
Beijing said to plan boosting export rebates Government may give a full rebate of the tax on products like furniture, shoes and toys
C
hina may expand exporters’ tax rebates to help them cope with a slump in trade growth, according to three people with direct knowledge of the plan, deploying a stimulus tool used during the global credit crunch. The government may give a full rebate of the 17 percent value-added tax on products including furniture, shoes and toys, up from the current range of 13 percent to 15 percent, said the people, who asked not to be identified because the discussions are private. The policy may be rolled out as soon as this month, depending on whether trade remains weak, they said. Premier Wen Jiabao has pledged policy “fine tuning” to cope with a deepening slowdown in the world’s second-largest economy that saw export gains slump to an annual 1 percent pace in July from 11 percent in June. The deterioration in trade escalated the risk that Mr Wen will miss his full-year economic expansion target for the first time since he took office in 2003. “The tax rebates cover mainly
labour-intensive products, and it reflects the government’s concern about rising unemployment pressures,” said Joy Yang, chief Greater China economist for Mirae Asset Securities (HK) Ltd. The policy change is unlikely to increase exports, said Ms Yang, who formerly worked for the International Monetary Fund. “The biggest problem for Chinese exports now is the weak demand from overseas
US$84 billion Value of export-tax rebates in the first half of 2012
markets, and tax rebates won’t help much in boosting demand.”
Policy loosening China used the tool in 2008 and 2009 to help the economy when exports plunged during the global financial crisis, at one point raising tax rebates on 553 products including motorcycles and sewing machines. The nation’s exports fell 16 percent in 2009 from 2008. Shipments abroad of products covered by the tax change totalled at least US$130 billion in 2011, or about 6.8 percent of China’s overseas sales, based on data compiled by Bloomberg News. China’s customs administration is scheduled to publish August trade data on September 10, and the September figures on October 13. The nation’s gross domestic product expanded 7.6 percent in the second quarter from a year earlier, the slowest pace in three years. Mr Wen set a 2012 goal of 7.5 percent in March. “Further policy loosening is needed to prevent a further slowdown in
Goldman Sachs cuts China earnings forecasts Slowing economy dampens expectations
G
oldman Sachs Group Inc. lowered earnings growth forecasts for China’s companies and Credit Suisse Group AG cut the nation’s stock index targets as the economy slows. Profits for companies in the MSCI China Index may increase 1.8 percent this year and 8.6 percent in 2013, compared with previous growth estimates of 6 percent and 12.3 percent, Helen Zhu and Timothy Moe, analysts at the U.S. bank, wrote in a report released last Monday. Credit Suisse lowered its 12-month target for the index to 60 from 70, analysts Vincent Chan and Peggy Chan said in a report yesterday. Third-quarter “earnings growth
We expect further earnings cuts in the coming months, albeit at a slower rate, as current revision sentiment is very weak already Helen Zhu and Timothy Moe, Goldman Sachs Group
Shipments of products covered by the tax change to
production growth,” Sun Mingchun and Sun Chi, Hong Kong-based economists at Daiwa Securities Group Inc., wrote in a note yesterday. “Export growth should remain weak.” China needs targeted measures to promote steady growth in overseas sales, including speedier payment of tax rebates, Mr Wen said during a visit
as new orders contracted and output rose at a slower pace, according to the Purchasing Managers’ Index released by the statistics bureau on September 1. Earnings per share for companies in the MSCI China Index of mainly Hong Kong-listed Chinese companies rose 2 percent in the first six months of 2012, slowing from 28 percent growth in the same period a year earlier, according to the Goldman report. China’s economy may risk missing the government’s 2012 growth target of 7.5 percent, according to Lu Ting, head of Greater China economics at Bank of America Corp. The MSCI China lost 0.8 percent to 52.42 at the close in Hong Kong, taking its drop this year to 1.1 percent. The Shanghai Composite dropped 0.8 percent to 2,043.65, the lowest close since February 2009. The Hang Seng China Enterprises Index, which tracks so- called H shares traded in Hong Kong, has slumped 7.4 percent this year. It fell 1 percent to 9,195.78 yesterday. The Credit Suisse analysts lowered their target for the Hang Seng gauge to 12,000 from 13,000, based on an assumption of “flat” earnings growth in the next three years.
Lower valuations may not yet show a clear inflection point,” Goldman’s Ms Zhu and Mr Moe wrote. “We expect further earnings cuts in the coming months, albeit at a slower rate, as current revision sentiment is very weak already.” The Shanghai Composite Index has retreated 6.8 percent this year on concern two reductions in borrowing costs and bank reserve ratios this year will fail to halt a decline in economic growth. China’s economy grew 7.6 percent in the three months through June, the slowest pace since 2009, as Europe’s debt crisis hurt exports and a crackdown on property speculation damped domestic demand. Manufacturing shrank for the first time in nine months in August
For stocks to rise, “we will need either a stabilised global economy or the Chinese government’s macro policy addressing stimulus or structural reform,” the analysts said. Stocks may rebound in the next three-to-six months on valuations, according to Credit Suisse’s analysts. Current earnings forecasts have already factored in weak economic conditions, Minggao Shen and Ben Wei, analysts at Citigroup Inc., wrote in a Monday report. “Further policy easing looks inevitable after weak August data, cost pressure will be lessened and restocking before year-end is possible, all contributing to a better earnings outlook,” they said. Bloomberg
September 5, 2012 business daily | 9
greater china
Cambodia gets soft loans, grants Premier Wen Jiabao thanks country’s help in ASEAN meeting
C
otalled at least US$130 billion in 2011
last month to Guangdong, the biggest exporter among China’s provinces. The government provided 531.6 billion yuan (US$84 billion) in export-tax rebates in the first half of 2012, an increase of 16.4 percent from a year earlier, according to the Finance Ministry. Reuters
hina has pledged more than US$500 million in soft loans and grants to Cambodia and Prime Minister Wen Jiabao thanked it for helping Beijing maintain good relations with the regional grouping ASEAN, a Cambodian junior minister said. A summit of the 10 members of the Association of Southeast Asian Nations (ASEAN) in July failed to issue a joint communique for the first time in the group’s 45-year history after disagreement over the wording of a section on territorial claims in the South China Sea. Cambodia, which chairs ASEAN meetings this year, was accused by some countries in the group of stonewalling in support of its ally, China. Four loan agreements for unspecified projects worth about US$420 million were signed when Cambodian Prime Minister Hun Sen visited China over the weekend, Secretary of State for Finance Aun Porn Moniroth told a briefing late on Monday. Another three loan agreements, worth more than US$80 million, are expected to be signed this year, Aun Porn Moniroth said, adding that Mr Wen had also promised a grant of 150 million yuan (US$24 million) as “a gift” for Cambodia to use on any priority project.
“The Chinese government also voiced high appreciation for the part played by Cambodia as the chair of ASEAN to maintain good cooperation between China and ASEAN,” Aun Porn Moniroth said. According to Xinhua official news agency, Mr Wen said China “will closely coordinate with Cambodia and support the country to make the upcoming series of meetings for East Asian leaders a success”. Those meetings take place in Cambodia in November. Chinese investment in Cambodia
totalled US$1.9 billion last year, more than double the combined investment by ASEAN countries and 10 times more than the United States, which is trying to extend its influence in the region. Aun Porn Moniroth said Premier Wen had given “positive consideration” to Cambodia’s prime minister proposal that China provide new loans of between US$300 million to US$500 million per year for the next five years for unspecified projects. Reuters
More Chinese investment promised
Lenovo to announce Brazil expansion plan Good results and growth plan drive stocks up
Lenovo aims to overtake HP as top computer maker
L
enovo Group Ltd rose to the highest in two weeks in Hong Kong trading after the world’s second-largest computer maker said its chief executive will announce plans for expansion in Brazil today. Lenovo rose 1.2 percent to close at HK$6.62, the highest level since August 21. Earlier it gained as much as 5.2 percent. Chief executive Yang Yuanqing will make the “biggest announcement in the company’s history in Brazil” today, Lenovo said in a statement. The company didn’t immediately
supply additional information. Lenovo is looking for sales to firsttime computer buyers in emerging markets such as Brazil and India to continue driving growth that’s faster than the industry average as the company closes in on Mr Yang’s goal of passing market leader HewlettPackard Co. in global shipments. Mr Yang in an August 31 interview had said he would consider acquisitions to build competence in areas where the company is weak. The company on July 5 announced plans to invest US$30 million to build
a computer factory and a distribution centre in Itu, in the Brazilian state of São Paulo. That unit will have as many as 700 employees in two years, when it’s expected to reach maximum capacity, Lenovo said at that time. Lenovo will also “fully leverage” the tool of acquisitions if a target “is consistent with our strategy,” Mr Yang said last Friday.
Shares surge The company’s shares have gained 28 percent in Hong Kong this
year, compared with a 5.4 percent advance in the city’s benchmark Hang Seng Index. Lenovo on August 16 posted a 30 percent increase in fiscal first-quarter profit as it expanded market share globally. Net income climbed to US$141.4 million in the three months ended June 30, from US$108.8 million a year earlier. Sales in the company’s AsiaPacific and Latin America division that includes Brazil increased 72 percent to US$1.72 billion during the period, the company said at the time. Lenovo increased shipments of computers including Thinkpad laptops by almost 15 percent in the second quarter, even as industry levels fell 0.1 percent, Stamford, Connecticut-based Gartner Inc. said on July 11. That increased its market share by two percentage points to 14.7 percent in the second quarter, almost matching Hewlett-Packard’s 14.9 percent, Gartner said. Bloomberg
10 |
business daily September 5, 2012
ASIA Nomura’s Vereker named vice chairman Nomura Holdings Inc. appointed investment banking co-head William Vereker as vice chairman of the business, leaving Kentaro Okuda to lead the unit. A Nomura spokesman in New York confirmed the contents of the document. But colleagues who work with Mr Vereker said that he would in all likelihood leave the bank soon, now that he was no longer in charge of the investment banking operations, even if he would see existing deals to an end, Reuters reported.
Iwata urges monetary easing to stem yen rise Former BOJ deputy governor urges bank to buy foreign bonds Leika Kihara
cuts in wages and prices of their goods, aggravating deflation, Mr Iwata warned. During his five-year stint at the BOJ until 2008, Mr Iwata was seen as one of the board members most keen to expand monetary stimulus. He served as deputy governor when the central bank exited from quantitative easing. But he opposed raising interest rates in 2007, arguing that it was premature with Japan barely out of deflation. Currently head of the Japan Centre for Economic Research, a private think tank in Tokyo, Mr Iwata said the BOJ should buy huge sums of longer-dated Japanese government bonds (JGB) under its asset-buying programme, and consider buying foreign bonds to weaken the yen.
KEY POINTS BOJ must act as risks to Japan economy rising – Iwata Adds yen rise behind deflation, bolder action needed BOJ should buy longer-dated govt, foreign bonds Kazumasa Iwata is regarded as a key candidate for BOJ governor
J
apan’s central bank needs to ease monetary policy by buying longer-dated government bonds and foreign assets to prevent yen rises and remove a key obstacle to Japan’s emergence from more than a decade of deflation, a former Bank of Japan deputy governor said. “Risks to Japan’s economy are heightening, so further monetary easing is necessary,” Kazumasa Iwata, the former deputy governor,
told Reuters in an interview. Mr Iwata is a member of a government panel that helps frame long-term economic policies and is regarded as a strong candidate to succeed Bank of Japan Governor Masaaki Shirakawa when his term expires in April next year. Mr Iwata said the global economic slowdown is hurting Japanese exports and output, while consumer spending has begun to lose support from government
stimulus measures. Japan’s core consumer prices fell 0.3 percent in July from a year earlier, and Mr Iwata said that it would be difficult for the central bank to achieve its 1 percent inflation target set in February. “With the yen so strong now, it’s extremely hard for Japan to beat deflation,” he said. The yen’s persistent strength also means Japanese exporters have no choice but to offset the pain with
Hyundai union backs new wage deal Carmaker, workers agree to end costliest strike Rose Kim
H
yundai Motor Co., South Korea’s largest carmaker, reached an agreement with its union workers to end the costliest strike in the company’s history. An August 30 accord between labour representatives and Hyundai was backed by 53 percent of the company’s 45,000 guild members, according to a statement on the union’s website yesterday. The agreement, which will raise the average compensation by 27.3 million won (US$24,000) and discontinue overnight shifts, ends
the first legally sanctioned walkouts at the carmaker since 2008. Seoulbased Hyundai Motor estimates the dispute cost the company a record 1.7 trillion won (US$1.5 billion) in lost production. “It’s definitely good news but the production loss was worse than expected and will most likely have a negative impact on the company’s third-quarter earnings,” said Lee Sang Hyun, an analyst at NH Investment & Securities Co. “However, Hyundai will be able to make up for the losses in the fourth
US$264.7 million
Hyundai plans to invest in equipment and facilities to maintain output
“Policymakers sometimes make mistakes and among them is to under-estimate the severity of the problem,” Mr Iwata said. “We’re now undergoing a big [global financial] shock, which means Japan needs bolder monetary easing, he said. Having eased policy in February and April, however, the central bank has stressed that it will act again only if risks to the economy heighten sharply.
quarter and meet their yearly sales target by end of the year.” Hyundai shares fell 2.28 percent to 236,000 won in Seoul trading as the strike led the company’s monthly sales, reported yesterday, to fall for the first time since May 2009. The wage agreement includes a 98,000 won increase in monthly base salary, a one-time payout of 9.5 million won and bonuses worth 500 percent of a worker’s monthly salary, according to a separate statement on the union’s website. This is equivalent to an average of 27.3 million won extra per person, according to the statement.
New shifts The pact will also end overnight shifts from March next year. Employees will now work from 6:40am to 3:20pm or 3:20pm to 1:10am as Hyundai ends 24-hour staffing of assembly lines.
September 5, 2012 business daily | 11
asia Osaka considers pricing change Osaka Securities Exchange Co. is considering offering rebates to customers willing to make a market in futures offering a hedge against swings in the Nikkei 225 Stock Average, Matthias Rietig, executive advisor to the board, said. The exchange plans to offer maker-taker pricing, which pays the suppliers of bids and offers and charges those executing against them, to boost liquidity and volumes for contracts on the Nikkei Stock Average Volatility Index. “We’re currently doing a consultation on if it’s attractive or not,” Mr Rietig said.
The BOJ next meets for a rate review on September 18-19.
Bolder steps As a member of the government panel steering long-term economic policy, Mr Iwata caused a stir last year by proposing that the BOJ set up a 50 trillion yen (US$639 billion) fund to buy foreign bonds to prevent yen rises. The proposal has not made much headway due to opposition by the finance ministry, which has the last word on currency policy. But the proposal made Mr Iwata a favourite candidate to become the next BOJ governor among lawmakers who feel the central bank should take bolder steps to beat deflation, which is hampering consumer spending and business investment. Mr Iwata said he was sticking to the proposal, arguing that by using the fund to buy eurozone bonds, Japan would both prevent yen rises and help Europe battle its debt crisis. His idea came under renewed focus after Takehiro Sato, who joined the BOJ’s policy-setting board in July, said purchasing foreign bonds could be a future policy option. But many central bankers remain doubtful and point to current law that prohibits the BOJ from buying foreign assets for the purpose of influencing currency rates. In 2010, the BOJ created as a key monetary easing tool an assetbuying fund targeting government bonds and private assets, but not foreign bonds. It topped up the fund several times, including February and April this year, but has held fire since then. BOJ officials argue that the central bank should save its ammunition for as long as possible, as the bank is already struggling to force-feed cash to markets already awash with extra cash. But Mr Iwata said that by targeting longerdated JGBs, the central bank should be able to pump more cash into the market.
Australia keeps key rate at 3.5pct Central bank flags some uncertainty over China Michael Heath
A
ustralia maintained the highest benchmark interest rate among major developed economies as domestic demand weathers a global slowdown that’s driving down the price of iron ore, the nation’s biggest commodity export. Reserve Bank of Australia Governor Glenn Stevens and his board left the overnight cash-rate target at 3.5 percent, according to a statement yesterday in Sydney. While domestic consumption was “quite firm” in the first half of the year, commodity prices have fallen “sharply” in recent months and China’s growth outlook is more uncertain, he said. In Australia, “growth has been running close to trend, led by very large increases in capital spending in the resources sector,” Mr Stevens said. “Labour market data have shown m o d er a te em p l o y m en t growth, even with job shedding in some industries, and the rate of unemployment has thus far remained low.” The Australian dollar rose after the decision as investors pared bets on RBA rate reductions. While Europe’s fiscal crisis is weighing on global growth and Chinese demand, Mr Stevens’ 75 basis points of cuts in May and June helped spur domestic spending and stabilise the housing market in an economy that’s avoided a recession for 21 years. Mr Stevens said the local dollar’s strength was greater than the central bank anticipated. “The exchange rate has declined over the past month or two, though it has remained higher than might have been expected, given the observed
decline in export prices and the weaker global outlook,” he said.
Currency rebounds The currency rebounded from near a six-week low, buying US$1.0264 at 3pm in Sydney compared with US$1.0232 before the announcement. The decision to hold for a third straight meeting was predicted by all 24 economists surveyed by Bloomberg News. Investors are pricing in a 38 percent chance that the benchmark rate will remain at 3.5 percent next month, up from a 30 percent chance yesterday, according to swaps trading
The exchange rate has declined over the past month or two, though it has remained higher than might have been expected, given the observed decline in export pricesand the weaker globaloutlook Glenn Stevens, Reserve Bank of Australia
data compiled by Bloomberg. BHP Billiton Ltd.’s decision last month to delay approval of an estimated US$33 billion expansion of the Olympic Dam copper, uranium and gold mine sparked suggestions the resources boom that has powered Australian growth is over. Fortescue Metals Group Ltd, Australia’s biggest iron ore producer after Rio Tinto Group and BHP, said yesterday it was cutting its full-year capital spending forecast by 26 percent to US$4.6 billion.
Mining boom A quarter of Australia’s exports, or about 5 percent of gross domestic product, goes to China, and 60 percent of those shipments are iron ore. Australian commodity prices declined 4.3 percent in August from the prior month and 18.5 percent from a year earlier in Australian dollar terms, a central bank index showed this week. The gauge reached the lowest level since April 2010. “Some commodity prices of importance to Australia have fallen sharply in recent weeks,” Mr Stevens said. “The terms of trade peaked a year ago and have declined significantly since then, though they remain historically high.” Even so, the economy probably expanded 0.7 percent last quarter from the prior three months for the strongest first half of growth since 2007, a Bloomberg News survey of economists showed before a government report on secondquarter GDP tomorrow. Bloomberg
Reuters
The company will invest about 300 billion won (US$264.7 million) in equipment and facilities to maintain output after working hours are reduced, according to an e-mailed statement on August 30. While Hyundai Motor has periodically faced partial stoppages in the past four years because of labour disputes, none were legally sanctioned and they rarely lasted beyond several hours. The last formal strike occurred in 2008, when a 12-day walkout cost the company an estimated 44,645 vehicles, or 691 billion won, according to Hyundai. Hyundai estimates labour disputes had caused missed production of more than 1 million vehicles and lost sales worth 11.6 trillion won before this year. Workers went on strike in 21 of the first 22 years since the union’s 1987 formation. Bloomberg
Pressure mounts for rate cut as another miner scales back investment
12 |
business daily September 5, 2012
MARKETS Hang SENG INDEX NAME
NAME
PRICE
Day %
VOLUME
AIA GROUP LTD
26.1
-0.7604563
18697263
CHINA UNICOM HON
ALUMINUM CORP-H
2.91
-0.3424658
11310320
CITIC PACIFIC
2.8
-1.060071
192368402
BANK OF COMMUN-H
4.99
-0.7952286
39094501
BANK EAST ASIA
28.1
-0.3546099
640365
BELLE INTERNATIO
13.78
-1.71184
7140048
BOC HONG KONG HO
24.55
-0.4056795
5038589
HANG LUNG PROPER
12.4
-0.6410256
4200866
HANG SENG BK
106.1
-0.748363
2627252
HENDERSON LAND D
BANK OF CHINA-H
CATHAY PAC AIR CHEUNG KONG CHINA COAL ENE-H
6.4
-1.990812
15652993
CHINA CONST BA-H
5.05
-0.9803922
171620514
CHINA LIFE INS-H
21.1
0.7159905
33522165
CHINA MERCHANT
22.35
-1.106195
CHINA MOBILE
82.9
CHINA OVERSEAS
17.8
CHINA PETROLEU-H CHINA RES ENTERP CHINA RES LAND CHINA RES POWER CHINA SHENHUA-H
CLP HLDGS LTD CNOOC LTD
PRICE
Day %
VOLUME
12.26
0.8223684
35657698
POWER ASSETS HOL
8.97
-4.166667
15150986
SANDS CHINA LTD
64
-1.081917
2000584
VOLUME
-0.4893964
1636573
28.35
1.431127
6841957
12.7
-2.307692
7619821
101.3
-0.4911591
1419928
92.3
0
607670
-1.410788
1961924
SINO LAND CO SUN HUNG KAI PRO
-0.5442177
26833688
9.64
0.4166667
3194438
SWIRE PACIFIC-A
ESPRIT HLDGS
12.4
1.472995
3079065
TENCENT HOLDINGS
237.6
26.35
-0.1893939
1161557
TINGYI HLDG CO
22.75
0.2202643
5598085
110.7
-0.1803427
589166
9.43
-0.8412198
5946500
48.75 -0.06150062
1726523
-1.306783
2620180
-1.094092
4014821
HONG KONG EXCHNG
103
0
2983193
2022182
HSBC HLDGS PLC
67.4
-0.2220577
8806488
-0.3605769
9863221
HUTCHISON WHAMPO
67.5
-0.2217295
3363970
-1.982379
27041343
IND & COMM BK-H
4.16
-0.952381
247822285
7.1
-2.739726
79765430
LI & FUNG LTD
11.92
-2.931596
49381847
23.2
-1.4862
2185260
MTR CORP
27.95
-0.1785714
1405562
HENGAN INTL HONG KG CHINA GS
15.6
-0.6369427
8661737
NEW WORLD DEV
9.67
-0.9221311
3337148
16.82
-0.5910165
3414247
PETROCHINA CO-H
9.34
-0.1069519
43436119
10416060
Day %
61
14.62
79.3
-1.415929
PRICE
COSCO PAC LTD
18.08
27.85
NAME
PING AN INSURA-H
55.5
WANT WANT CHINA
MOVERS
6
41
2 19610
INDEX 19429.91 HIGH
19601.87
LOW
19414.62
52W (H) 21760.33984 19410
(L) 16170.35 31-Aug
-0.090009
10493686
PRICE
DAY %
VOLUME
23.15
-0.6437768
6077549
7.1
-2.739726
79765430
ZIJIN MINING-H
4-Sep
Hang SENG CHINA ENTErPRISE INDEX NAME
NAME
PRICE
DAY %
VOLUME
AGRICULTURAL-H
2.81
-1.748252
78805789
CHINA PACIFIC-H
AIR CHINA LTD-H
4.58
0.6593407
14246672
CHINA PETROLEU-H
ALUMINUM CORP-H ANHUI CONCH-H BANK OF CHINA-H
VOLUME 9423845
2.5
-0.7936508
18739502
11310320
CHINA RAIL CN-H
6.11
1.663894
17099462
ZOOMLION HEAVY-H
8.16
-2.040816
11060960
12613253
CHINA RAIL GR-H
2.92
2.45614
21778000
ZTE CORP-H
9.96
-3.300971
7059336
2.8
-1.060071
192368402
CHINA SHENHUA-H
27.85
-1.415929
10416060
CHINA TELECOM-H
39094501
4.3
-1.826484
38430672
1615714
DONGFENG MOTOR-H
9.97
0
9636308
CHINA CITIC BK-H
3.6
-1.639344
22533242
GUANGZHOU AUTO-H
5.21
-1.698113
3898177
CHINA COAL ENE-H
6.4
-1.990812
15652993
HUANENG POWER-H
5.3
-0.9345794
14172845
CHINA COM CONS-H
5.84
-3.311258
20963856
IND & COMM BK-H
4.16
-0.952381
247822285
CHINA CONST BA-H
5.05
-0.9803922
171620514
JIANGXI COPPER-H
16.76
0
4764361
CHINA COSCO HO-H
2.84
-2.068966
31265854
PETROCHINA CO-H
9.34
-0.1069519
43436119
CHINA LIFE INS-H
21.1
0.7159905
33522165
PICC PROPERTY &
8.75
-4.266958
24767639
CHINA LONGYUAN-H
4.97
0.811359
3436744
PING AN INSURA-H
55.5
-0.090009
10493686
CHINA MERCH BK-H
12.74
-3.04414
42664840
SHANDONG WEIG-H
8.36
-0.4761905
2005600
CHINA OILFIELD-H
-0.8960573
0.3036437
-1.0279
CHINA NATL BDG-H
DAY %
11.06
-0.3424658
-0.7952286
CHINA MINSHENG-H
PRICE
2.91
4.99
BYD CO LTD-H
YANZHOU COAL-H
19.82
13.48
BANK OF COMMUN-H
NAME
MOVERS
8
30
2 9350
INDEX 9195.78 HIGH
9343.26
LOW
9195.78
6
-3.846154
57527066
SINOPHARM-H
24.15
0.2074689
1092522
52W (H) 11916.1
7.41
0.5427408
23000215
TSINGTAO BREW-H
42.3
-1.74216
488000
(L) 8058.58
12.42
-0.1607717
2724233
WEICHAI POWER-H
21.1
1.686747
1249959
9190
31-Aug
4-Sep
Shanghai Shenzhen CSI 300 PRICE
DAY %
VOLUME
PRICE
DAY %
VOLUME
PRICE
DAY %
VOLUME
AGRICULTURAL-A
2.45
0
46764250
DAQIN RAILWAY -A
5.94
-1.164725
24429750
SANY HEAVY INDUS
9.29
-5.876393
64280306
AIR CHINA LTD-A
4.66
-2.916667
13378102
DATANG INTL PO-A
4.38
-1.351351
2366426
SHANDONG GOLD-MI
35.53
-0.8372872
9763882
ALUMINUM CORP-A
5.04
-1.945525
12950334
DONGFANG ELECT-A
14.13
-1.05042
8134757
SHANG PHARM -A
11.61
-1.443124
9769392
13.34
0.07501875
11638114
EVERBRIG SEC -A
11.23
-0.9700176
6036965
SHANG PUDONG-A
7.46
-1.583113
44361378
BANK OF BEIJIN-A
7.2
-1.234568
11580670
GD MIDEA HOLDING
9.18
0
9139999
SHANGHAI ELECT-A
4.02
-0.7407407
2685013
BANK OF CHINA-A
2.75
0
19756307
GD POWER DEVEL-A
2.47
-1.593625
30498594
SHANXI LU'AN -A
16.73
-1.991798
11060866
SHANXI XINGHUA-A
36.84
-2.873715
1623756
SHANXI XISHAN-A
12.59
0.159109
11536816
NAME
ANHUI CONCH-A
NAME
NAME
BANK OF COMMUN-A
4.21
-1.635514
63355918
GF SECURITIES-A
10.33
-1.337154
27569717
BANK OF NINGBO-A
9.36
-2.398332
10307455
GREE ELECTRIC
20.75
-0.2883229
5083426
BAOSHAN IRON & S
4.33
-0.4597701
39911630
GUANGHUI ENERG-A
12.93
1.015625
15784022
SHENZEN OVERSE-A
5.54
-2.636204
15599344
HAITONG SECURI-A
8.54
-1.157407
38258195
SUNING APPLIAN-A
6.38
4.078303
119080250 854411
BYD CO LTD -A
15.59
-0.2559181
8943178
CHINA CITIC BK-A
3.79
-1.558442
13636149
HANGZHOU HIKVI-A
27.26
0.9255831
4482235
TASLY PHARMAC-A
50.06
-0.8909127
CHINA CNR CORP-A
3.41
-1.445087
20483559
HENAN SHUAN-A
55.49
-0.1798885
3278317
TSINGTAO BREW-A
33.01
-0.5123568
909734
CHINA COAL ENE-A
6.73
-1.029412
7467424
HONG YUAN SEC-A
16.5
-1.079137
10069520
WEICHAI POWER-A
17.79
-1.111729
9623702 19560975
CHINA CONST BA-A
3.9
-2.01005
24698161
HUATAI SECURIT-A
8.57
-1.832761
10034657
WULIANGYE YIBIN
33.53
-1.06226
CHINA COSCO HO-A
3.78
-2.325581
9915949
HUAXIA BANK CO
8.43
-2.991945
29247009
XIAMEN TUNGSTEN
38.42
-2.462554
7628656
CHINA EAST AIR-A
3.32
-2.639296
9583468
IND & COMM BK-A
3.74
-0.795756
21838054
YANGQUAN COAL -A
13.83
-1.072961
9829397
2.72
-1.090909
34848627
INDUSTRIAL BAN-A
12.12
-1.383238
37663306
YANTAI CHANGYU-A
50.15
-1.065299
1316161
17.83
-1.16408
6709590
INNER MONG BAO-A
32.41
1.37629
44818458
YANTAI WANHUA-A
12.61
-1.020408
5488350
CHINA MERCH BK-A
9.84
-1.698302
43905130
INNER MONG YIL-A
20.26
-0.1970443
6930808
YANZHOU COAL-A
17.2
-0.5780347
3974767
CHINA MERCHANT-A
9.77
-2.49501
9001272
INNER MONGOLIA-A
4.99
-2.539062
63028617
YUNNAN BAIYAO-A
58.27
-1.254025
1693775
CHINA EVERBRIG-A CHINA LIFE INS-A
CHINA MERCHANT-A
20.03
-1.52409
7830253
JIANGSU HENGRU-A
30.41
-0.1313629
2050511
ZHONGJIN GOLD
14.6
-0.8825526
11606263
CHINA MINSHENG-A
5.68
-1.730104
106403982
JIANGSU YANGHE-A
123.7
-2.252074
2286987
ZIJIN MINING-A
3.72
-1.06383
30275750
CHINA NATIONAL-A
6.03
-0.9852217
18131451
JIANGXI COPPER-A
19.88
-0.3009027
5520609
ZOOMLION HEAVY-A
7.96
-3.748489
82545349
10.98
-2.05174
5188327
ZTE CORP-A
9.59
-2.639594
11856639
12.36
-1.199041
13252414
CHINA OILFIELD-A
16.21
-1.399027
2491057
JINDUICHENG -A
CHINA PACIFIC-A
19.62
-1.506024
9429283
JIZHONG ENERGY-A
CHINA PETROLEU-A
6.11
0.9917355
28469165
KANGMEI PHARMA-A
15.54
0.9090909
12293578
CHINA RAILWAY-A
4.23
-0.7042254
11305435
KWEICHOW MOUTA-A
233.43
6.220422
11150873
36.49
-1.829432
4715389
CHINA RAILWAY-A
2.42
-1.626016
16258547
LUZHOU LAOJIAO-A
CHINA SHENHUA-A
21.44
-0.8325624
8247919
METALLURGICAL-A
2
-1.960784
30493704
CHINA SHIPBUIL-A
4.76
-0.6263048
51337827
NINGBO PORT CO-A
2.47
-0.4032258
16121952
3.64
-2.673797
46230257
MOVERS
26
CHINA SOUTHERN-A
3.46
-1.142857
16911536
CHINA STATE -A
3.03
-0.6557377
26309149
PETROCHINA CO-A
8.78
-0.3405221
9497865
13.87
-2.392681
20775580
HIGH
2232.84
LOW
2200.59
CHINA UNITED-A
3.75
-1.315789
44754764
CHINA VANKE CO-A
8.23
-0.7237636
37074476
PING AN INSURA-A
39.43
-1.053952
10036469
CHINA YANGTZE-A
6.37
0
9276472
POLY REAL ESTA-A
9.95
-1.7769
34412132
CHONGQING WATE-A
5.45
-1.446655
3915464
QINGDAO HAIER-A
10.46
-1.784038
5929269
CITIC SECURITI-A
10.58
0.5703422
62214987
QINGHAI SALT-A
30.7
-2.166985
3695310
CSR CORP LTD -A
3.92
-1.507538
23327385
SAIC MOTOR-A
11.72
-1.013514
12838982
PRICE DAY %
Volume
PRICE DAY %
Volume
12 2235
INDEX 2204.407
PANGANG GROUP -A PING AN BANK-A
259
52W (H) 2836.624 (L) 2188.724
2200
31-Aug
4-Sep
FTSE TAIWAN 50 INDEX NAME ACER INC
26.4
0
7747477
ADVANCED SEMICON
23.2
0.6507592
17183910
ASIA CEMENT CORP
34.3 -0.2906977
NAME FORMOSA PLASTIC
80.9
PRICE DAY %
5154297
TAIWAN MOBILE CO
106.5
FOXCONN TECHNOLO
116.5 -0.4273504
8282553
TPK HOLDING CO L
398.5 -0.1253133
2251956
FUBON FINANCIAL
29.55 -0.8389262
10872749
TSMC UNI-PRESIDENT
47.25 -0.2111932
UNITED MICROELEC
11.95
0
ASUSTEK COMPUTER
303.5
0.4966887
2337592
HON HAI PRECISIO
89.9 -0.1111111
50380170
AU OPTRONICS COR
9.56
3.913043
85079444
HOTAI MOTOR CO
213 -0.4672897
329288
CATCHER TECH
NAME
0.3722084
84
154
1.315789
14334166
HTC CORP
256
-2.10325
16621698
CATHAY FINANCIAL
28.65
-0.174216
6425342
HUA NAN FINANCIA
16.1
0.3115265
4534420
YUANTA FINANCIAL
CHANG HWA BANK
15.35
0
4771466
LARGAN PRECISION
635
-1.244168
1688727
YULON MOTOR CO
72.2 -0.4137931
7358831
LITE-ON TECHNOLO
36
0.2785515
2283442
CHENG SHIN RUBBE CHIMEI INNOLUX C CHINA DEVELOPMEN CHINA STEEL CORP CHINATRUST FINAN CHUNGHWA TELECOM COMPAL ELECTRON DELTA ELECT INC FAR EASTERN NEW
1.25261
34051436
MEDIATEK INC
325
1.5625
9496685
7.08 -0.4219409
9.7
17915044
MEGA FINANCIAL H
22.25
-1.548673
30925652
-1.372549
32887857
NAN YA PLASTICS
55.8
0.1795332
3003860
17.9 -0.5555556
19421034
PRESIDENT CHAIN
158 -0.3154574
932289
90 -0.1109878
6287122
QUANTA COMPUTER
79.8 -0.4987531
4948639
33.55 -0.8862629
25.15
25.05
0
9424527
SILICONWARE PREC
105
1.941748
3064179
SINOPAC FINANCIA
11.6
-1.694915
11344938
31.15 -0.1602564
5288245
SYNNEX TECH INTL
66.9 -0.1492537
2067415
0
2991582
TAIWAN CEMENT
33.05
1.536098
12114752
16.35 -0.6079027
4089009
WISTRON CORP
MOVERS
19
26
-3.61991 0.1191895
Volume 5264102 6218856 21703446 7669308 17209820
34
0.8902077
5830471
13.65
-1.798561
11350071
53
-2.573529
6914024
5 5140
INDEX 5124.57
3436655
FAR EASTONE TELE
73.5
FIRST FINANCIAL
17.5
0.286533
5173207
TAIWAN COOPERATI
FORMOSA CHEM & F
77.4
0.2590674
2162093
TAIWAN FERTILIZE
74.5
0.1344086
3771600
FORMOSA PETROCHE
86.5
1.525822
1589383
TAIWAN GLASS IND
29.9
-1.157025
5306742
HIGH
5135.17
LOW
5066.99
52W (H) 5621.53 (L) 4643.05
5060
31-Aug
4-Sep
September 5, 2012 business daily | 13
MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) gALAXy enTeRTAInMenT
MeLCo CRoWn enTeRTAInMenT
MgM CHInA HoLDIngS
22.50
30.5
22.42
30.3
29.9
22.26
Min 22.1
22.10
Last 22.3
SAnDS CHInA LTD
Average 28.252
Max 28.45
Last 28.35
Max 30.25
Average 30.175
29.3
Max 12.68
Average 12.597
Min 12.56
Last 12.68
Wynn MACAU LTD 18.3
28.2
16.4
18.2
28.0
16.3
18.1
27.8
16.2 Max 16.46
Average 16.349
PRICE
WTI CRUDE FUTURE Oct12
97.14
0.69451643
-1.460742544
110.6499939
78.15999603
BRENT CRUDE FUTR Oct12
116.34
0.483675937
11.25561825
123.2900009
89.11000061
GASOLINE RBOB FUT Oct12
300.15
0.965419806
18.75840785
304.0199995
220.5600023
GAS OIL FUT (ICE) Oct12
1005.5
0.474644017
11.97104677
1044.75
799
2.792
-0.250089318
-15.95424443
4.590000153
2.299999952
HEATING OIL FUTR Oct12
DAY %
YTD %
(H) 52W
Min 16.2
Last 16.44
18.0 Max 18.24
Average 18.163
321.22
1.006226024
12.41294838
333.8899851
252.5300026
1692.33
0.2102
8.1423
1921.18
1522.75
Silver Spot $/Oz
32.185
1.1312
15.6278
43.265
26.085
Platinum Spot $/Oz
1550.9
0.5576
11.2155
1896.75
1339.25
Palladium Spot $/Oz
633.65
0.3277
-3.0375
773.6
537.54 1827.25
LME ALUMINUM 3MO ($)
1927
1.314405889
-4.603960396
2444
LME COPPER 3MO ($)
7679
0.840446487
1.039473684
9160
6635
LME ZINC
1874
1.792504074
1.571815718
2269
1718.5
3MO ($)
LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) Nov12 Dec12
WHEAT FUTURE(CBT) Dec12 SOYBEAN FUTURE Nov12 COFFEE 'C' FUTURE Dec12
PRICE
(L) 52W
Gold Spot $/Oz
Last 18.02
Min 18.02
MAJORS
ASIA PACIFIC
CROSSES
16220
1.692789969
-13.30839123
22150
15236
15.305
0.130847236
0.657678395
17.5
14.15499973
807.25
0.93779306
37.69722814
849
499
897.75
0.927487352
24.6875
953.25
629.5
1779
1.280956447
47.72680091
1789
1115.75
167.55
1.699544765
-29.00423729
281.0499878
153.6999969
CROWN LTD
AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP
DAY %
1.0255 1.5894 0.953 1.2602 78.42 7.989 7.7563 6.3473 55.6038 31.18 1.2453 29.85 41.875 9588 80.426 1.20103 0.79288 8.0039 10.068 98.83 1.03
0.0878 -0.0126 0.2204 0.2386 -0.1403 0.0025 0.0026 -0.1087 -0.1237 0.1604 0.2088 0.134 0.2149 -0.5528 -0.2362 -0.0175 -0.2459 -0.3786 -0.2394 -0.3744 0
YTD %
(H) 52W
0.4506 2.2583 -1.5635 -2.7698 -1.9255 0.1327 0.1431 -0.824 -4.5659 1.1867 4.1195 1.4372 4.6925 -5.413 -2.4793 1.3122 5.1092 1.628 2.8208 0.8398 0.0097
(L) 52W
1.0857 1.6302 0.9972 1.4278 84.18 8.0413 7.8077 6.406 57.3275 32 1.3199 30.716 44.35 9662 88.637 1.24736 0.88423 9.1104 11.435 111.6 1.0311
0.9388 1.5235 0.7821 1.2043 75.35 7.9823 7.7526 6.2769 45.9638 29.88 1.2048 29.027 41.57 8548 72.057 1.1017 0.77553 7.7018 9.6245 94.12 1.0288
MACAU RELATED STOCKS NAME ARISTOCRAT LEISU
PRICE
(H) 52W
(L) 52W
2.7
DAY % YTD % 0.3717472
22.72727
3.25
1.88
VOLUME CRNCY 3503491
9.02
-0.2212389
11.49567
9.29
7.47
1275271
SUGAR #11 (WORLD) Oct12
19.92
0.707785642
-12.74638633
25.39999962
19.23999977
AMAX HOLDINGS LT
0.061
0
-29.88506
0.119
0.055
0
COTTON NO.2 FUTR Dec12
76.89
-0.478889526
-12.46584699
102.25
64.61000061
BOC HONG KONG HO
24.55
-0.4056795
33.42392
24.95
14.24
5038589
CENTURY LEGEND
20000
World Stock MarketS - Indices NAME
0.221
-1.777778
-3.913045
0.335
0.204
CHEUK NANG HLDGS
3.18
0.6329114
13.57143
3.5
2.3
96000
CHINA OVERSEAS
17.8
-1.982379
37.2885
19.138
9.979
27041343
CHINESE ESTATES
9.7
-2.316213
-22.4
13.68
8.3
9000
CHOW TAI FOOK JE
9.38
-0.9503696
-32.61494
15.16
8.4
1961612
EMPEROR ENTERTAI
1.42
0.7092199
27.92793
1.48
0.97
300000
FUTURE BRIGHT
1.13
0
169.0476
1.24
0.3
474000
GALAXY ENTERTAIN
22.3
0.9049774
56.60113
24.95
8.69
5047000
COUNTRY
PRICE
DAY %
YTD %
(H) 52W
(L) 52W
DOW JONES INDUS. AVG
US
13090.84
0.6932698
7.147747
13338.66016
10404.49
NASDAQ COMPOSITE INDEX
US
3066.965
0.5987448
17.72701
3134.17
2298.89
HANG SENG BK
110.7
-0.1803427
20.13022
112.3
84.4
589166
FTSE 100 INDEX
GB
5717.86
-0.7041874
2.612577
5989.07
4868.6
HOPEWELL HLDGS
25.05
0.804829
26.13293
25.4
18.56
1259000
DAX INDEX
GE
6992.97
-0.3116255
18.55807
7194.33
4965.8
HSBC HLDGS PLC
67.4
-0.2220577
14.23729
71.8
56
8806488
HUTCHISON TELE H
3.77
-1.308901
26.08696
3.88
2.53
2570000
LUK FOOK HLDGS I
20.85
-1.184834
-23.06273
39.75
14.7
1048000
MELCO INTL DEVEL
6.27
-1.104101
8.665512
8.54
4.3
1566976 684310
NIKKEI 225
JN
8775.51
-0.09540192
3.78648
10255.15
8135.79
HANG SENG INDEX
HK
19429.91
-0.6610696
5.400339
21760.33984
16170.35
CSI 300 INDEX
CH
2204.407
-1.075316
-6.025171
2836.624
2188.724
MGM CHINA HOLDIN
12.68
0.7949126
32.19138
14.76
7.6
TAIWAN TAIEX INDEX
TA
7451.35
0.01100593
5.36292
8170.72
6609.11
MIDLAND HOLDINGS
4.31
0
9.002246
5.217
2.887
622248
NEPTUNE GROUP
0.168
0.5988024
51.35135
0.205
0.08
6490000
NEW WORLD DEV
9.67
-0.9221311
54.47284
10.96
6.13
3337148
SANDS CHINA LTD
28.35
1.431127
29.15717
33.05
14.9
6841957
SHUN HO RESOURCE
1.13
0
13
1.28
0.82
0
SHUN TAK HOLDING
2.84
-1.045296
10.97529
3.75
2.241
1447509
KOSPI INDEX
SK
1907.13
-0.2917327
4.457919
2057.28
1644.11
S&P/ASX 200 INDEX
AU
4303.512
-0.6041799
6.08771
4448.5
3840.2
ID
4105.253
-0.3082846
7.411345
4234.734
3217.951
FTSE Bursa Malaysia KLCI
MA
1654.11
0.01269726
8.060207
1655.49
1310.53
NZX ALL INDEX
NZ
816.4
0.1456061
11.86622
818.513
712.548
JAKARTA COMPOSITE INDEX
12.50
16.5
NAME
CORN FUTURE
Last 30.25
CURRENCY EXCHANGE RATES
NATURAL GAS FUTR Oct12
METALS
Min 29.35
28.4
Commodities ENERGY
12.55
29.5
SJM HoLDIngS LTD
Min 27.8
12.60
29.7
22.18 Average 22.310
12.65
30.1
22.34
Max 22.45
12.70
SJM HOLDINGS LTD
16.44
0.7352941
31.46178
17.614
10.079
5925067
SMARTONE TELECOM
16.48
-1.904762
22.61905
18.5
9.8
1151957
WYNN MACAU LTD
18.08
0
-7.282051
25.5
14.62
1929826
ASIA ENTERTAINME
3.41
-2.011494
-42.0068
7.65
2.4
135504
24.74
679337 8198
PHILIPPINES ALL SHARE IX
PH
3439.03
-0.4705828
12.93875
3531.5
2695.06
HSBC Dragon 300 Index Singapor
SI
581.18
-0.14
17.1
NA
NA
STOCK EXCH OF THAI INDEX
TH
1237.12
0.1327419
20.65697
1247.72
843.69
BALLY TECHNOLOGI
44.29
0.02258356
11.95652
49.32
HO CHI MINH STOCK INDEX
VN
402.08
1.530226
14.37349
492.44
332.28
BOC HONG KONG HO
3.09
-0.3225806
28.90106
3.25
1.81
Laos Composite Index
LO
1028.61
-0.09906471
14.35861
1064.23
876.33
GALAXY ENTERTAIN
2.78
-0.3584229
48.6631
3.24
1.08
155
INTL GAME TECH
12.29
0.5728314
-28.54651
18.1701
10.92
3306889
JONES LANG LASAL
72.13
1.434397
17.74405
87.52
46.01
339704
LAS VEGAS SANDS
42.39
1.460029
-0.7956928
62.09
34.72
6041138
MELCO CROWN-ADR
11.72
0.5145798
21.82952
16.02
7.05
2542077
MGM CHINA HOLDIN
1.64
0
37.61931
1.96
1.0025
10400
MGM RESORTS INTE
9.86
0.3051882
-5.465008
14.9401
7.4
6588511
15.17
-0.2629849
29.43686
18.77
7.55
234730
2.1
4.477612
30.63172
2.2782
1.2624
7650
103.17
0.3111327
-6.625032
154.7051
90.108
970553
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business daily September 5, 2012
Opinion
China is okay
Stephen S. Roach
Member of the faculty at Yale University, was chairman of Morgan Stanley Asia
C
oncern is growing that China’s economy could be headed for a hard landing. The Chinese stock market has fallen 20 percent over the past year, to levels last seen in 2009. Continued softness in recent data – from purchasing managers’ sentiment and industrial output to retail sales and exports – has heightened the anxiety. Long the global economy’s most powerful engine, China, many now fear, is running out of fuel. These worries are overblown. Yes, China’s economy has slowed. But the slowdown has been contained, and will likely remain so for the foreseeable future. The case for a soft landing remains solid. The characteristics of a Chinese hard landing are well known from the Great Recession of 2008-2009. China’s annual GDP growth decelerated sharply from its 14.8 percent peak in the second quarter of 2007 to 6.6 percent in the first quarter of 2009. Hit by a monstrous external demand shock that sent world trade tumbling by a record 10.5 percent in 2009, China’s export-led growth quickly went from boom to bust. The rest of an unbalanced Chinese economy followed – especially the labour market, which shed more than 20 million jobs in Guangdong Province alone. This time, the descent has been far milder. From a peak of 11.9 percent in the first quarter of 2010, China’s annual GDP growth slowed to 7.6 percent in the second quarter of 2012 – only about half the outsize 8.2-percentage-point deceleration experienced during the Great Recession. Barring a disorderly breakup of the eurozone, which seems unlikely, the International Monetary Fund’s baseline forecast of 4 percent annual growth in world trade for 2012 seems reasonable. That would be subpar relative to the 6.4 percent growth trend from 1994 to 2011, but nowhere near the collapse recorded during 2008-2009. With the Chinese economy far less threatened by export-led weakening than it was three and a half years ago, a hard landing is unlikely.
round of projects. Reports of ghost cities, bridges to nowhere, and empty new airports are fueling concern among Western analysts that an unbalanced Chinese economy cannot rebound as it did in the second half of 2009. With fixed investment nearing the unprecedented threshold of 50 percent of GDP, they fear that another investment-led fiscal stimulus will only hasten the inevitable China-collapse scenario. But the pessimists’ hype overlooks one of the most important drivers of China’s modernisation: the greatest urbanisation story the world has ever seen. In 2011, the urban share of the Chinese population surpassed 50 percent for the first time, reaching 51.3 percent, compared to less than 20 percent in 1980. Moreover, according to OECD projections, China’s already burgeoning urban population should
expand by more than 300 million by 2030 – an increment almost equal to the current population of the United States. With rural-to-urban migration averaging 15 to 20 million people per year, today’s so-called ghost cities quickly become tomorrow’s thriving metropolitan areas. Shanghai Pudong is the classic example of how an “empty” urban construction project in the late 1990’s quickly became a fully occupied urban centre, with a population today of roughly 5.5 million. A McKinsey study estimates that by 2025 China will have more than 220 cities with populations in excess of one million, versus 125 in 2010, and that 23 mega-cities will have a population of at least five million. China cannot afford to wait to build its new cities. Instead, investment and construction must be aligned with the future influx of urban dwellers. The “ghost city” critique misses this point entirely.
Balancing options
But the pessimists’ hype overlooks one of the most important drivers of China’s modernisation: the greatest urbanisation story the world has ever seen
All of this is part of China’s grand plan. The producer model, which worked brilliantly for 30 years, cannot take China to the promised land of prosperity. The Chinese leadership has long known this, as Premier Wen Jiabao signalled with his famous 2007 “Four ‘Uns’” critique – warning of an “unstable, unbalanced, uncoordinated, and ultimately unsustainable” economy. Two external shocks – first from the U.S., and now from Europe – have transformed the Four Uns into an action plan. Overly dependent on external
demand from crisis-battered developed economies, China has adopted the pro-consumption 12th Five-Year Plan, which lays out a powerful rebalancing strategy that should drive development for decades. The investment and construction requirements of large-scale urbanisation are a key pillar of this strategy. Urban per capita income is more than triple the average in rural areas. As long as urbanisation is coupled with job creation – a strategy underscored by China’s concomitant push into servicesled development – labour income and consumer purchasing power will benefit. Contrary to the China doubters, urbanisation is not phony growth. It is an essential ingredient of the “next China,” for it provides China with both cyclical and structural options. When faced with a shortfall of demand – whether owing to an external shock or to an internal adjustment, such as the housing-market correction – China can tweak its urbanisation-led investment requirements accordingly. With a large reservoir of surplus savings and a budget deficit of less than 2 percent of GDP, it has the wherewithal to fund such efforts. There is also ample scope for monetary easing; unlike central banks in the West, the People’s Bank of China has plenty of ammunition in reserve. A growth slowdown is hardly shocking for an export-led economy. But China is in much better shape than the rest of the world. A powerful rebalancing strategy offers the structural and cyclical support that will allow it to avoid a hard landing. © Project Syndicate
Future cities To be sure, the economy faces other headwinds, especially from the policy-induced cooling of an overheated housing market. But construction of so-called social housing for lowerincome families, reinforced by recent investment announcements in key metropolitan areas such as Tianjin, Chongqing, and Changsha, as well as in Guizhou and Guangdong Provinces, should more than offset the decline. Moreover, unlike the bank-funded initiatives of 3-4 years ago, which led to a worrisome overhang of local-government debt, the central government seems likely to play a much greater role in financing the current
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September 5, 2012 business daily | 15
OPINION
Cheesy group photos wires symbolise economic paralysis Business
Leading reports from Asia’s best business newspapers
Bangkok Post Two local mobile operators will ally with TOT Plc to launch a fourth-generation (4G) wireless broadband trial by the end of the year, said the head of Thailand’s state telecom enterprise. The 4G trial will use long-term evolution (LTE) technology running on the 2300-megahertz frequency. Some 400 4G base stations will be located in central Bangkok and some major provinces. The two private firms are required to install last-mile equipment and rent TOT’s backbone network to provide services.
Korea Herald Aside from Samsung Electronics’ multibillion dollar patent suit against Apple Inc. in the U.S., the two are expected to stage another battle at a court in the Netherlands this Friday. Earlier in June, the court handed the first victory to Samsung by claiming Apple violated the firm’s patent involving third-generation wireless telecommunications technology. Winning the court case in the Netherlands is crucial for Samsung because it also has court battles set to take off in Germany, France and Italy in the following months.
Jakarta Globe A roadshow by seven Indonesian state companies to entice foreign interest yielded positive responses, with investors generally keen to plant funds, despite some questions over the possible impacts of global crisis on Indonesia. Sevenstate-controlled companies – Bank Negara Indonesia, Bank Mandiri, Bank Rakyat Indonesia, Perusahaan Gas Negara, Semen Gresik, Telekomunikasi Indonesia and Pegadaian – took their roadshow to Hong Kong, meeting more than 62 major fund managers and investors that have been putting their funds in the Indonesian equity market and state-controlled companies’ stocks.
Business Standard Tata Motors’ commercial vehicles segment, which contributes more than half of the company’s profits and is the biggest truck maker in the country, on Monday said it has seen a slight revival in demand for heavy trucks and hopes for the trend to continue in the festive period. In June, Tata Motors was forced to shut down its manufacturing unit for heavy trucks for three days due to lack of demand. The company is planning truck variants to serve a wider customer audience.
William Pesek Bloomberg columnist
A
s Pacific-Rim leaders gather for a summit in the Russian city of Vladivostok, one thing seems painfully clear: it will end in disappointment. This isn’t a matter of cynicism, but frustration at the paucity of accomplishments by the 21-member Asia-Pacific Economic Cooperation group over the last two decades. It has proved to be too disparate economically, geographically and ideologically to get big things done. If its summits are memorable at all, it is because of the wacky outfits leaders are obliged to wear for the customary class photo. Furry hats, anyone? That’s a shame given the magnitude of the region’s challenges: slowing growth, territorial disputes and overreliance on exports to countries that can’t consume as they once did. More troubling is the leadership void as APEC prepares for its September 8-9 confab. Still, here are four things I would love to see APEC tackle this weekend. First, attack the bubble in inequality. If anything is clear about the last decade, it’s that the rich are getting richer at the expense of the poor. Other than a Pacific shoreline, the one thing countries such as Brunei, Chile, Russia, the U.S. and Vietnam genuinely have in common is a widening income gap. This socially corrosive development does no one any good aside from those at the top.
Free-trade zone Working jointly to eradicate corruption and build better safety nets would broaden the benefits of growth. So would an APEC-wide freetrade zone. World leaders and trade ministers talk a good game about reducing tariffs and sign off on sweeping communiques to that effect. We need less gabbing and more action to stop trade deals from becoming bilateral and narrowly focused. The problem in today’s world isn’t too much globalisation, but not enough for those who need it most. Reinvigorating an area that accounts for roughly 55 percent of global output through lower barriers on goods, services and people would create a new economic engine in a world that needs one. Two, address climate change. APEC should join hands to promote energy conservation. Its members burn through more than their fair share of oil, gas, coal and trees. That reliance on dirty energy fouls Hong Kong’s
skies, causes deadly floods in Thailand and the Philippines, adds to the price of Chinese goods, raises costs for American motorists and forces Indonesia to offer budgetcrippling fuel subsidies. It burdens Japan at a time when the majority of its nuclear reactors are offline, hurting manufacturers beset by a rising yen. It feeds hostility between China and its neighbours and distorts Australia’s resourcedependent economy. Cutting use of fossil fuels would lower tensions in the South China Sea and increase incentives for alternative green-energy sources. That might help reduce the need for massive public-infrastructure expenditure, cut poverty, tame inflation, increase manufacturing productivity and slash health-care costs. Three, overhaul territorial laws driving Asia toward armed conflict. APEC should help devise a code of conduct for the disagreements among China, Japan and South Korea. The leaders of three of Asia’s biggest economies can’t even get into a room together and chat. That is an impediment to lowering trade barriers, linking bond and stock markets and figuring out what to do with the trillions of dollars of currency reserves Asia has amassed over the last 15 years.
Checking nationalism At the very least, APEC should include the issue in its formal communique in ways that the 10-member Association of Southeast Asian Nations hasn’t. The benefits of pragmatism and free trade outweigh nationalistic tendencies. If Asia doesn’t put these issues on the discussion table now, the result could
be clashes that imperil trade, credit ratings and markets. Four, devise a common response to North Korea. APEC members include five of the six parties trying to rein in that country’s ambitions to build an arsenal of nuclear weapons. It is perhaps the only forum in which China’s financial support of the Kim Dynasty could conceivably come in for criticism. The United Nations, where China has a
The problem in today’s world isn’t too much globalisation, but not enough for those who need it most
permanent Security Council seat and veto privileges, sure hasn’t done the job. The recent power transfer from the late Kim Jong Il to his son, Kim Jong Un, is an opportunity for the AsiaPacific region to tackle one of the biggest threats to peace and stability. All APEC leaders need to do is take it. One idea: hold up Myanmar’s sudden opening, and the world’s rapid embrace of its efforts, as a blueprint for the good that may come from change in North Korea. There are many other things on which APEC should take the lead – water and food security, human trafficking, a global approach to financial regulation, increasing literacy, seeing to it that girls are educated as well as boys. The trouble is, the group’s performance since its first summit in 1989 is so spotty. APEC has to improve its record. Humanity needs more from Vladivostok than photos of people in furry hats. Bloomberg View
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business daily September 5, 2012
CLOSING Lufthansa crew in second walk-out
Cameron reshuffles U.K. cabinet
Lufthansa Airlines has cancelled about 300 flights as cabin staff staged another day of industrial action at three of Germany’s biggest airports. Strike action called by the UFO union was under way at Frankfurt, Munich and Berlin airports yesterday. Lufthansa cancelled short and medium-haul flights but also services to and from Los Angeles, Houston, Chicago, Beijing and Mexico City. UFO and Lufthansa have been in dispute over pay and working conditions. Lufthansa has about 19,000 cabin crew and the UFO union represents about two-thirds of them.
British Prime Minister David Cameron kept his unpopular finance minister George Osborne in a reshuffle of his cabinet yesterday that he hopes will revive the Conservative-led government’s fortunes in the middle of a term dominated by recession. Mr Cameron is expected to beef up his economic team by giving Justice Secretary Ken Clarke – a former finance minister – a new role with an economics brief. Mr Cameron’s office has billed the rejig as a game changer but heavyweights such as Foreign Secretary William Hague are seen staying put and few changes are expected in policy.
S’pore to stop flats from shrinking further Govt to cap homes in bid to ‘discourage’ shoebox units Pooja Thakur
S
ingapore will cap the number of homes that can be developed in suburban projects as it seeks to curb the increasing trend of so-called shoebox apartments. The government plans to limit the number of homes for apartment projects outside the city’s central area to “discourage” shoebox units, the Urban Redevelopment Authority said in a statement posted on its website yesterday. The new rules will be implemented from November 4. The island state’s population growth, scarce land and surging property values have prompted developers to shrink housing space. Residential prices surged to a record at the end of 2011 in a city and the government said in May it’s concerned that shoebox apartments are mushrooming as private home sales surged to a three-year high with record purchases of units that are smaller than 50 square metres (538 square feet). “The new guidelines will discourage new developments consisting predominantly of ‘shoebox’ units outside the central area, but at the same time give flexibility to developers to offer a range of homes of different sizes to cater to the needs of various demographic groups and lifestyles,”
according to the statement. Shoebox units will increase more than four-fold to about 11,000 units by the end of 2015 from 2,400 at the end of last year, the authority said. Singapore should curb the trend of shoebox apartments because they are “almost inhuman,” said Liew Mun Leong, chief executive of CapitaLand Ltd, Southeast Asia’s biggest developer. The government should intervene because these projects are “wasting” the country’s scarce land resource, he said in the interview in May.
Consumer trends The smaller apartments helped boost sales, comprising 2,766 units or 42 percent of the sales in the first quarter, Li Hiaw Ho, executive director at CBRE Research, said in an e-mailed statement in July. Home sales have climbed to 12,254 units this year through June 30, according to data from the authority. Suburban projects will be the “driving force” for developers in the second half of 2012, PropNex said. The government’s guidelines are a “welcome move” amid concerns of smaller homes dominating the suburbs, according to Jones Lang LaSalle. “The policy itself is well thought
Shoebox units in Singapore will increase more than four-fold to about 11,000 units by the end of 2015
through,” the Chicago-based property brokerage, said in an e-mailed statement. “Central area, where land prices are high, is excluded thereby allowing market forces to continue to dictate the relevant housing form especially through the measures of financial affordability and equally that of consumers’ preferences and trends.” The government doesn’t wa n t s h o eb o x u n i ts t o f o r m a “disproportionately large portion”
of the housing supply in Singapore, the Urban Redevelopment Authority said yesterday. Some new housing developments are made up mostly of these smaller units, sometimes as much as 80 percent of a project, it said. A large concentration of such developments could add stress to the local road infrastructure with more units that the government had planned for, according to the statement. Bloomberg
Moody’s lowers EU rating outlook Outlook for the Aaa credit rating changed to ‘negative’
M
oody’s Investors Service has changed its outlook on the Aaa rating of the European Union to negative, warning it might downgrade the bloc if it decides to cut the ratings on the EU’s four biggest budget backers: Germany, France, U.K. and Netherlands. The ratings agency said that in case of “extreme stress”, the Aaa rated member states were more likely to service their own debt obligations rather than “prioritise their commitment to backstop the EU debt obligations”. “Hence, it is reasonable to assume that the EU’s creditworthiness should move in line with the creditworthiness of its strongest key member states,” the agency said. The move will add to pressure on the European Central Bank to provide
details of a new debt-buying scheme to help deeply indebted eurozone states at its policy meeting tomorrow. Back in July, Moody’s changed its outlook for Germany, the Netherlands and Luxembourg to negative as fallout from Europe’s debt crisis cast a shadow over its top-rated countries. The outlook on France and the UK are also negative. “The negative outlook on the EU’s long-term ratings reflects the negative outlook on the Aaa ratings of the member states with large contributions to the EU budget: Germany, France, the UK and the Netherlands, which together account for around 45 percent of the EU’s budget revenue,” the ratings agency said. Moody’s said the EU’s rating would be particularly sensitive to any
changes in the ratings of these four Aaa member states, implying that if it downgraded these four it might also cut the EU’s rating. “Additionally, a weakening of the commitment of the member states to the EU and changes to the EU’s fiscal framework that led to less conservative budget management would be creditnegative,” the agency said. Likewise, Moody’s said the outlook for the EU could go back to stable if the outlooks on the four key Aaa countries also returned to stable. The agency also changed to negative the outlook the European Atomic Energy Community (Euratom), on whose behalf the European Commission is also empowered to borrow. Reuters